Private Toll Roads

October 01, 1990|By Neal R. Peirce

LEESBURG, VIRGINIA — THERE MAY BE a private toll road in your future. For $1. $2 or maybe $3 one way each day, you will supposedly avoid suburban gridlock and get a clear lane to work. And Ralph Stanley is the guy who'd like to sell it to you.

Personable brash and bright still in his 30s, Mr. Stanley served as urban mass transit administrator in the Reagan administration. He now itches to be the first entrepreneur to score big with a modern- day private toll road.

Mr. Stanley won a green light from the state legislature to build Virginia's first private toll road since 1816. Scheduled for an opening in April 1993 - presuming the requisite $227 million gets raised - the highway will traverse 14 miles of farmland, westward from Washington's Dulles Airport into rural, fast-developing Loudoun County.

Prospects for success are high. The road will extend the profitable state toll road to Dulles. It's a straightforward proposition compared to such projects as the 521 - mile, $2.1-billion private road proposed from Chicago to Kansas City.

Mr. Stanley's road has been blessed by two Democratic governors - Gerald Baliles and L.. Douglas Wilder. Small wonder. The project is projected to pay $600 million in local, state and federal taxes over its 40-year plan - and then revert to state ownership.

If the Stapley project works, encouragement will be given to the many firms tr'ying to sell private toll roads from Florida to Colorado to California. Mr. Stanley says if this road works, he'll try 20 more.

With federal and state highway cupboards bare, it's not hard to envision a splurge of private toll roads, especially to serve America's affluent, traffic-clogged suburbs. George Bush's promise-everything-spend-nothing transportation planners are bound to be delighted.

Partnerships between counties and the toll operators may evolve. Loudoun County has to be elated by one provision in the state-enabling legislation - that if Mr. Stanley s Toll Road Corporation of Virginia outdoes its allowed rate of return, it must put the money in a fund to build and repair Loudoun County roads. Mr. Stanley says Loudoun may well find itself "independent of the state for road money."

Out in Colorado. there's "E-470," a 48-mile road to be financed by bonds backed by a Swiss bank. Director John Arnold, who starred a few years back as city manager of Fort Collins, reports construction is under way on the first 5.5-mile, $68-million segment in Denver's south suburbs. Mr. Arnold will need nearly $1 billion in commercial letters of credit for the rest of the road, which will run right by the door, of Denver's massive new international airport.

And in California, where the "FREEway" has been considered close to a constitutional right, the legislature has invited bids for several private toll roads - so long as they involve no cost to the state.

So, why not applaud entrepreneurs ready to save us from excruciating traffic delays and more taxes? Aren't we dramatically better off putting highway building into the hands of lean, competitively minded staffs, instead of large public-high-way bureaucracies?

Maybe so - but with a couple of reservations:

First, a toll road entrenches a private monopoly akin to the exclusive franchise that cable television firms enjoy and capitalize on. Unrestrained, a toll road paralleling severely congested streets could charge exorbitant fees.

Second, no one should be fooled: Private toll roads heading out into the suburbs and exurbs will be powerful growth generators. lining the pocket of many a developer. Just because someone can make money from a road, that doesn't mean it's environmentally or socially wise.

Mr. Stanley rightfully argues that a toll road like his gives the target county a rare opportunity to plan early and well, for where it wants dense development and pristine areas. Loudounl County, he suggests, should zone for dense development close to his road and protect natural areas farther away. But will it do so, when cash-rich developers start working on county council members?

A toll road into virgin exurban territory, says Colorado University Professor Albert Bartlett. creates "a feeding frenzy" for land speculators. It's folly to keep on fostering super-roads that generate so much new development they're promptly filled to capacity. And the United States has scarcely 32 years of petroleum reserves left.

In a rational world, professor Bartlett is right. But Americans aren't rational. Given our national character, we'll likely keep on building roads until the last barrel of oil, gurgles up some Persian Gulf well.

Minimally, we should demand that our state and local governments drive hard bargains with toll operators. Regulate on toll restraint. Demand good landscaping. Require - as Virginia legislators did in their deal with Mr, Stanley - a-rlght-of-way strip where rail transit can be added later.

Too much to hope? Maybe not. It may be easier for states to demand and get concessions out of private operators than they they've ever wrung out of their own state highway bureaucracies.

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